Eli Lilly said on Monday it will buy Loxo Oncology Inc. for $8 billion, an expensive bet on a pipeline of cancer drugs that target rare genetic mutations and the biggest acquisition in the drug-maker's 143-year history.
The price represents a 68 percent premium to Loxo's Friday share price close, which some Wall Street analysts said was high for a company with only one drug on the market that it shares with a partner.
Loxo shares surged 66 percent to $232.65, close to the offer price of $235 per share, and prompted stock price rises for a other small developers of targeted cancer therapies, including Array BioPharma, Blueprint Medicines Corp. and Clovis Oncology Inc. Lilly shares rose 0.5 percent to $115.28.